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The Government of New South Wales, a state in the south-east of Australia, have decided to sell a 51% stake in Sydney Motor Corporation (SMC) to Sydney Transport Partners (STP), a consortium comprising Transurban, AustralianSuper, Canada Pension Plan Investment Board and Tawreed Investments, a wholly-owned subsidiary of the Abu Dhabi Investment Authority.
SMC is responsible for managing the development, construction, funding, operation and maintenance of WestConnex, a programme of infrastructure projects that aims to develop and upgrade road access in the south-west of Sydney, valued at AUD16.8 billion (US$12.1 billion).
The programme consists of three projects in development and two in operation. The widening of 7.5 km of existing M4 motorway, in western Sydney, was completed in 2017, with tolls commencing in August. A new interchange on the M5 motorway was opened to traffic in late 2016 and completed in 2017.
The projects in development are:
The government of New South Wales will retain the remaining 49% stake in WestConnex until it is completed in entirety.
STP initially faced competition from three other consortia interested in acquiring the stake. However, bidding teams led by Netflow and CIMIC withdrew from the process before the government's final decision. STP's remaining competition was led by IFM Investors.
The agreed purchase price is thought to be AUD9.3 billion (US$6.69 billion), with Transurban (majority shareholder) to raise AUD4.2 billion (US$3.02 billion) equity and undertake a AUD600 million (US$431.3 million) securities placement to AustralianSuper and Tawreed Investments to fund the acquisition. The transaction is expected to close in late September.